As market sinks, couple decides to swap
An OC couple was hunting for a home; they found another family in the same boat, and traded houses
When the housing market started to collapse, Oregon City residents Larry and Teresa Walton saw an opportunity.
After more than a decade in their 1,100 square foot home in Oregon City, they were ready for a move, and conditions were becoming favorable for buyers.
'We thought with the market as it is, this would probably be a good time to be able to move up,' Larry explained.
But first, they would need to sell their own house.
Larry estimated there were a few thousand dollars in minor repairs necessary before the home would be ready to show. With the couple each working 12-hour shifts at jobs in Hillsboro, there was little time to make the necessary fixes.
So they turned to the Internet.
Larry began browsing Craigslist.com for a home that fit their needs. They wanted something close to Oregon City but with more space, a bigger yard, and a garage big enough to house Larry's oversized truck. The couple found a home off of Beavercreek Road that fit the bill. Then things got interesting.
After a brief email correspondence with the homeowners - they were selling the house without a realtor - Larry discovered that the primary wage earner had a contracting business that was slowing down as the market lagged. They were a family, and were hoping to downsize to something more manageable.
'I said, well, how about trading homes,' Larry recalled.
Of course, no major transaction is as easy as it sounds in today's real estate market, and the two homeowners faced a number of hurdles, many caused by reluctant lenders in a market some say is over-correcting itself after the sub-prime mortgage fallout.
The Waltons' mortgage broker, who asked not to be named because he since switched companies, said people who are now having trouble getting a loan could have been approved 'by about 30 different banks about a year ago.'
Larry said banks balked at the proposition at first, despite the Waltons' excellent credit rating. Even after lenders warmed to the proposition, there were hoops to jump through, as they questioned the appraisal and the nature of the transaction. Since there were no realtors involved, banks wanted to be sure the house swap was an 'arm's length' transaction and not a mortgage bailout scam.
After working out the complicated swap - one family had to temporarily own both homes - the Waltons are delighted with the deal. Both homeowners got roughly full value from their homes, and both bypassed realtors and their 5 to 7 percent fees. The Waltons let the family whose home they moved into store some items on the property for a month. And the contractor who moved into their old home didn't think the minor repairs Larry had been putting off were a big deal.
'It really worked out to be a cool win-win situation for us,' Larry said. 'I was really thinking we had come up with something unique and creative.'
The Waltons may not be alone, however. In recent weeks, there have been ads popping up on Web sites like Craigslist.com for housing swaps. Many of them are even posted by realtors.
One recent search turned up a homeowner in Milwaukie's river district looking to trade their home for something more rural. Another was posted by a SE Sunnyside Road homeowner with a four bedroom house looking to downsize.